2015 Appropriation Budget Table of Contents Board Approved August 15, 2014

Transcription

1 INDIANAPOLIS AIRPORT AUTHORITY 2015 APPROPRIATION BUDGET ORDINANCE NO BOARD APPROVED AUGUST 15, 2014

2 2015 Appropriation Budget Table of Contents Board Approved August 15, Appropriation Summary 2 Budget Overview 3 Airport System Fund Expenses 4 Capital Improvement Fund 5 Rates and Charges Supplemental Schedules: 6-7 Capital Improvement Program Summary 8 Airport System Fund Revenues 9 Capital Improvement Fund Sources of Funds Projections 10 Analysis of Airport System Fund Revenue 11 Analysis of Airport System Fund Expenses

3 Appropriation Summary ($000) Total Total Personal Services $ 29,028 $ 29,065 Supplies & Materials 5,512 5,866 Contractual Services and Debt Service 162, ,062 Operating Capital Total Airport System Fund $ 197,319 $ 198,696 * Total Capital Improvement Fund $ 53,000 $ 57,000 * * Appropriation amount published in local newspapers on 7/8 and 7/15 1

4 Budget Overview The Authority is pleased to offer for your consideration the proposed 2015 operating budget. The 2015 proposed budget emphasizes safety and security, the preventive maintenance programs required to preserve the assets of the Authority, operational efficiency and excellence in customer service. The goal of the Authority is to be a good steward to the traveling public within Central Indiana and the surrounding region while being conscientious of the costs to operate and maintain the airport system at the highest standards. Overriding Financial Achievements within this budget include: Achieving minimal 2015 Airline rate increases Debt Coverage ratios exceeding required minimum of 1.25 Liquidity: Adequate cash flow to service outstanding debt and capital program The IAA management team created the 2015 budget in concert with the Strategic plan with financial goals of increasing non-airline revenue, keeping operating cost increases to a minimum, funding the capital program without taking on new debt, maintaining adequate liquidity and maximizing leasing flexibility to attract new tenants. Highlights of assumptions used in the 2015 budget include: Expense Payroll 2.75% average increase Benefits 6.0% increase in health benefits 4.0% retirement match Utilities 7.5% increase in natural gas cost 5.0% increase in electrical cost Fuel 9.0% increase in Diesel fuel cost 10.0% increase in Gasoline cost Snow/Ice 1.0% increase in chemical cost due to increased fuel costs Insurance 5.0% increase due to market conditions and IAA s 2013 experience Revenue Fuel Flowage no rate changes anticipated at this time Parking no rate changes anticipated at this time CFC PFC no rate changes anticipated at this time rates governed by Federal law with no change allowed at this time Robert Thomson Sr. Director of Finance 2

5 Airport System Fund Expenses - Appropriated Budget Ordinance Ordinance vs 2014 Budget Ordinance Fav / (Unfav) Variance Budget Forecast Budget $ % OPERATING AND MAINTENANCE: Personal Services $ 29,028,000 $ 28,120,000 $ 29,065,000 $ (37,000) -0.1% Utilities 9,357,000 9,521,000 10,183,000 (826,000) -8.8% Contractual Services 18,124,000 19,261,000 18,971,000 (847,000) -4.7% Supplies & Materials 5,512,000 6,238,000 5,866,000 (354,000) -6.4% Other Charges 2,213,000 2,278,000 1,777, , % Capital Expenditures 376, , ,000 (327,000) -87.0% Environmental Remediation 34,000 35,000 34, % Total Operating Expenses 64,644,000 65,772,000 66,599,000 (1,955,000) -3.0% DEBT SERVICE: Special Leases - UAL 33,420,000 33,420,000 33,579,000 (159,000) -0.5% Interest Payments 52,722,000 52,667,000 50,838,000 1,884, % Principal Payments 46,533,000 45,460,000 47,680,000 (1,147,000) -2.5% Total Debt Service 132,675, ,547, ,097, , % TOTAL AIRPORT SYSTEM FUND $ 197,319,000 $ 197,319,000 $ 198,696,000 $ (1,377,000) -0.7% CAPITAL IMPROVEMENT FUND $ 53,000,000 $ 53,000,000 $ 57,000,000 $ (4,000,000) -7.5% 3

6 Capital Improvement Fund Appropriation New 2015 Projects (2015 Project Cost) $ 24,469 Parking Garage Improvements $ 5,126 Garage Atrium Canopy Replacement 2,800 PARCS System Assessment & Implementation 2,170 Noise & General Airport System Land Acquisition 1,500 Rehabilitate Runway & Taxiway Connectors A1, A2, A3, A4 1,419 Rehabilitate Airport Roads ,200 Apron Stormwater Inlet Repairs - IND 987 Rehabilitate T-Hangar Taxilanes - Indy Regional 979 Property - IAA Staff Consolidation 883 Other (Airport Funded Projects less than $750,000) 7,405 On-going (approved in prior year) Projects (2015 Project Cost) 22,716 Stormwater and Deicing Controls and Capacity - Phase 2B $ 5,000 Rehabilitate Runway 5L-23R Phase I and Phase II 4,878 Rehabilitate Apron at Old Terminal 4,358 Rehabilitate Taxiway A 2,921 Rehabilitate Taxiway B 2,605 Shuttle Bus Replacement (Parking) 900 Other (6 Projects under $750,000) 2,054 Subtotal (agrees to Program Summary p. 7) $ 47,185 Estimated potential carryover from prior year 6,815 Additional appropriation - unspecified revenue development projects 3,000 Total Capital Improvement Fund Appropriation $ 57,000 4

7 AUA - Rates and Charges $3.00 Signatory Airlines Apron Rates (Per Sq. Ft.) 2015 Budgeted Revenue=$0.2m $2.00 $2.56 $2.18 $2.62 $2.62 $1.86 $1.00 $0.00 $0.91 $0.72 $0.57 $0.34 $0.34 $0.27 ($1.00) $1.86 $1.83 $1.81 $1.79 $1.77 AUA Actual / 2015 Budget $2.00 Signatory Airlines Landing Fees (Per 1,000 lbs.) 2015 Budgeted Revenue=$18.3m $1.75 $1.82 $1.74 $1.95 $1.95 $1.95 $1.95 $1.95 $1.90 $1.88 $1.88 $1.92 $1.50 $1.25 $1.00 $1.95 $1.91 $1.88 $1.85 $1.80 AUA Actual / 2015 Budget Average Terminal Building Rates (Per Sq. Ft.) 2015 Budgeted Revenue=$26.5m $ $90.00 $95.00 $95.00 $95.00 $92.80 $91.68 $91.68 $95.11 $70.00 $75.09 $50.00 $55.55 $64.78 $63.03 $30.00 $95.00 $93.13 $91.68 $90.02 $88.50 AUA Actual / 2015 Budget 5

8 SUPPLEMENTAL SCHEDULES

9 INDIANAPOLIS AIRPORT AUTHORITY 2015 CAPITAL IMPROVEMENT PROGRAM SUMMARY July 24, 2014 Final - Review with Airlines *2015 PROJECT NUMBER PROJECT TITLE PROJECTS THAT ARE NOT SUBJECT TO MII VOTE (PROJECTS IN BLUE FONT WILL BE FUNDED USING 2015 AIRPORT FUNDS GREATER THAN $750,000) PROJECT TYPE TOTAL PROJECT COST ENTITLEMENT GRANTS CONTINGENT DISCRETIONARY & OTHER GRANTS AIRPORT FUNDS INTERNAL RATE OF RETURN (IRR) EXCLUSION IF NOT APPLIED 1 Apron Stormwater Inlet Repairs - IND Apron & Other Airfield 2, ** N/A Replacement of Necessary Asset 2 Pavement Management: Airfield Rehabilitation Program Apron & Other Airfield N/A Grant Funded / FAA Regulatory 3 Airfield Pavement Evaluation and Management Plan Update Apron & Other Airfield N/A Grant Funded / FAA Regulatory 4 Airfield Electrical Replacement - Preliminary Design Apron & Other Airfield N/A Grant Funded / Replacement of Necessary Asset 5 Rehabilitate Taxiway D Apron & Other Airfield 4, ,688 - ** N/A Grant Funded / Replacement of Necessary Asset 6 Install Concourse Exhaust Ducts Terminal N/A Retrofit to Initial Construction 7 Terminal Water Softening System Terminal ** N/A Retrofit to Initial Construction 8 Terminal Entry Expansion Joint Rehabilitation Terminal N/A Required Maintenance of Existing Asset 9 Parking Garage Improvements Parking 5, , ,126 N/A Required Maintenance of Existing Asset 10 Garage Atrium Canopy Replacement Parking 2, , ,800 N/A Replacement of Necessary Asset 11 Replacement of GTC and Pedestrian Entry Doors Parking N/A Required Maintenance of Existing Asset 12 Rehabilitate Asphalt Lots 2015 Parking N/A Required Maintenance of Existing Asset 13 Parking Garage Improvements Parking 4, ,643 - ** N/A Required Maintenance of Existing Asset 14 Garage Atrium Canopy Repair Parking N/A Required Maintenance of Existing Asset 15 Deicing Control Facilities Improvements Environmental & Other Regulatory N/A Grant Funded / Environmental / Regulatory 16 Stormwater REI Project Environmental & Other Regulatory % - 17 Rehabilitate Airport Roads Non-Airfield Roadways 1, ,200 ** - - 1,200 N/A Required Maintenance of Existing Asset 18 West Perimeter Road Bridge Repairs Non-Airfield Roadways N/A Required Maintenance of Existing Asset 19 Rehabilitate High School Road, Rehabilitate Roads 2014, and Replace Republic Entrance Non-Airfield Roadways 1,572-1,572 - ** N/A Required Maintenance of Existing Asset 20 PARCS System Assessment & Implementation Information Technology 2, , , % - 21 Computer, Server and Equipment Replacement Program (2015) Information Technology N/A Replacement of Equipment with no Utility 22 Capital Project Management System - Engineering Information Technology % - 23 Crashphone - Firehouse alerting Information Technology N/A Health Safety 24 HR System Alignment Information Technology % - 25 Airport Management System Upgrades - ERP Assessment (2013) Information Technology ** N/A Replacement of Required System 26 (2014) Snow Equipment Replacement - Snow Blowers (2 pieces) Vehicle & Equipment Replacement 1,314-1, N/A Replacement of Equipment with no Utility 27 (2015) Aerial Lift Truck Replacement Vehicle & Equipment Replacement % - 28 Property - IAA Staff Consolidation Other % - 29 Property - Relocate record storage create temp. controlled space for air cargo Other % - 30 Advance Planning and Design Other N/A Planning Capital 31 Construct New Airfield Maintenance Facility Other 12, N/A Replacement of Essential Asset / Safety / Grant Funded 32 Central Energy Plant Cooling Tower Steel Other N/A Required Maintenance of Existing Asset 33 IMC - Commons Building Roof Replacement Other N/A Required Maintenance of Existing Asset 34 Old Parking Garage - Preservation Project Revenue Development N/A Required Maintenance of Existing Asset 35 Property - Building 7 Rehabilitation Revenue Development N/A Required Maintenance of Existing Asset 36 Heliport HVAC Replacement Relievers N/A Replacement of Equipment with no Utility 37 Property - Building 63 Interior Demo Revenue Development >12.5% - ACTUAL COST THRU 2013 (1) 38 Noise & General Airport System Land Acquisition Properties & Non-Terminal Buildings 12,994 1,906 2,688 1, N/A Regulatory / Capacity Enhancement 2014 FORECAST COST 2015 PROJECT COST $ in 000's PROJECTED SOURCE OF FUNDS 2015 CASH FLOW HURDLE RATE *Project Numbers were only given to New Projects or those projects with cost increase more than 10% over originally approved amount. **Project was previously approved; however cost increased more than 10% or scope has changed. (1) Total includes only projects shown on the Program Summary. 6

10 INDIANAPOLIS AIRPORT AUTHORITY 2015 CAPITAL IMPROVEMENT PROGRAM SUMMARY July 24, 2014 Final - Review with Airlines *2015 PROJECT NUMBER PROJECT TITLE PROJECT TYPE TOTAL PROJECT COST ACTUAL COST THRU 2013 (1) 2014 FORECAST COST RD = Revenue Development Projects that are subject to the Hurdle Rate Policy, and as we enter into these projects, we will ensure that the appropriate Hurdle Rates are met before proceeding PROJECT COST $ in 000's ENTITLEMENT GRANTS PROJECTED SOURCE OF FUNDS 2015 CASH FLOW CONTINGENT DISCRETIONARY & OTHER GRANTS AIRPORT FUNDS INTERNAL RATE OF RETURN (IRR) HURDLE RATE EXCLUSION IF NOT APPLIED 39 Rehabilitate IAB Roof Properties & Non-Terminal Buildings N/A Required Maintenance of Existing Asset 40 IMC - Recoating of the IW Tank enclosure containment area Properties & Non-Terminal Buildings N/A Environmental / Regulatory 41 CEP - Install Variable Speed Drive on Chiller #2 Properties & Non-Terminal Buildings ** >12.5% Economics cannot be accurately forecast 42 Airport Layout Plan (ALP) Update - Eagle Creek Relievers N/A Grant Funded / FAA Regulatory 43 Rehabilitate, Relocate & Widen Taxiway B - Eagle Creek Relievers 1, N/A Grant Funded / FAA Regulatory 44 Structural Slab Replacement - Heliport Relievers ** N/A Grant Funded / Replacement of Necessary Asset 45 Rehabilitate Runway & Taxiway Connectors A1, A2, A3, A4 - Metropolitan Relievers 1, , , N/A Grant Funded / Replacement of Necessary Asset 46 Replace Airfield Lighting - Metropolitan Relievers N/A Grant Funded / Replacement of Necessary Asset 47 Rehabilitate T-Hangar Taxilanes - Indy Regional Relievers N/A Grant Funded / Replacement of Necessary Asset Previously Approved Rehabilitate Runway 5L-23R Phase I and Phase II Apron & Other Airfield 5, ,878 3,659-1,220 N/A Regulatory / Capacity Enhancement Previously Approved Rehabilitate Taxiway A Apron & Other Airfield 3, ,921-2, N/A Regulatory / Capacity Enhancement Previously Approved Stormwater and Deicing Controls and Capacity - Phase 2B Environmental & Other Regulatory 5, , ,000 1,250 N/A Regulatory / Capacity Enhancement Previously Approved Rehabilitate Taxiway B Apron & Other Airfield 9, ,605 1, N/A Grant Funded / Replacement of Necessary Asset Previously Approved Shuttle Bus Replacement (Parking) Vehicle & Equipment Replacement 2, RD Parking Revenue Development Strategy Previously Approved Geographic Information System Information Technology 1, RD Systems Improvement for Revenue Development Previously Approved Replace Aviation Fuel Farm - Heliport Relievers N/A Grant Funded / Environmental / Regulatory Previously Approved Purchase of Hydraulic Atrium Lift Vehicle & Equipment Replacement N/A Acquisition of Necessary Equipment Previously Approved Rehabilitate Apron at Old Terminal Revenue Development 4, , ,981 1,090 TBD Site Preparation for Revenue Development / Grant Funded Previously Approved Enlarge Terminal Entrance - Bag Claim Terminal N/A Retrofit to Initial Construction Previously Approved Disparity Study for the Indianapolis Airport Authority Environmental & Other Regulatory N/A FAA Regulatory Previously Approved Capital Salaries Other 3, N/A GAAP Requirement SUBTOTAL PROJECTS SHOWN ON THE PROGRAM SUMMARY 3,075 26,268 47,185 7,580 12,609 26, PROJECTS NOT LISTED ON THE PROGRAM SUMMARY 43,519 22,095 - GRAND TOTAL (1) 46,594 48,363 47,185 SUBTOTAL PROJECTS SUBJECT TO MII APPROVAL NONE *Project Numbers were only given to New Projects or those projects with cost increase more than 10% over originally approved amount. **Project was previously approved; however cost increased more than 10% or scope has changed. (1) Total includes only projects shown on the Program Summary. RD = Revenue Development Projects that are subject to the Hurdle Rate Policy, and as we enter into these projects, we will ensure that the appropriate Hurdle Rates are met before proceeding. 7

11 Airport System Fund Revenues -Appropriated Budget Ordinance Ordinance vs 2014 Budget Ordinance Fav / (Unfav) Variance Budget Forecast Budget $ % AIRLINE Landing Fees $ 17,279,298 $ 17,650,749 $ 18,340,578 $ 1,061, % Apron Fees 1,544,718 1,832,358 1,878, , % Airline Space 26,057,362 26,256,997 27,437,823 1,380, % Airline Total 44,881,378 45,740,104 47,657,120 2,775, % NON-AIRLINE AIRFIELD Fuel Sales 220, , ,000 (20,000) -9.1% Ground Handling / Other 163, , ,096 12, % RETAIL Food & Beverage 4,752,081 5,005,147 5,227, , % News & Gifts 1,085,081 1,118,468 1,136,866 51, % Specialty Shops 1,257,969 1,279,268 1,237,629 (20,340) -1.6% Advertising 923, , ,483 (87,694) -9.5% Car Rental 9,247,199 9,145,999 9,234,867 (12,332) -0.1% Other 1,441,842 1,380,928 1,371,686 (70,156) -4.9% PARKING & GTC Parking 37,666,671 40,500,085 40,500,085 2,833, % Ground Transportation Center 493, , ,513 (8,892) -1.8% PROPERTIES Freight Buildings 949, , ,726 (15,964) -1.7% Ground Leases 5,953,471 5,753,505 5,779,905 (173,566) -2.9% Hangars / Other Buildings 13,965,055 14,195,080 13,549,142 (415,913) -3.0% RELIEVERS 3,089,936 3,039,610 3,088,098 (1,838) -0.1% Indianapolis Maint. Center (IMC) 8,485,574 8,681,319 8,558,107 72, % OTHER INCOME 57,577 60,600 64,577 7, % Total Non-Airline Revenue 89,751,728 92,936,988 92,377,079 2,625, % OTHER REVENUES Special Leases - UAL 26,785,041 26,785,041 26,754,228 (30,813) -0.1% GASB Adjustment (306,354) (306,354) (306,354) - 0.0% Operating Grant Revenue 764, , , % Passenger Facility Charges (PFC's) 15,148,269 14,587,002 14,635,351 (512,918) -3.4% Customer Facility Charges (CFC's) 5,871,559 5,877,172 5,867,022 (4,537) -0.1% Interest 4,539,000 4,000,000 4,457,756 (81,244) -1.8% TOTAL OPERATING REVENUE 187,434, ,383, ,206,202 4,771, % LESS Inter-fund Transfers (9,827,524) (9,168,154) (9,329,199) 498, % TOTAL (net of transfers) $177,607,097 $181,215,799 $182,877,003 $5,269, % 8

12 Capital Improvement Fund - Source of Funds Projections Ordinance Ordinance vs 2014 Budget Ordinance Fav / (Unfav) Variance Budget Forecast Budget $ % Federal and State Grants (A) $14,003,893 $ 28,826,150 $ 20,254,700 $ 6,250,807 45% Interest 4,539,364 3,800,000 3,800,000 (739,364) -16% Operating Fund Transfers 5,288,160 5,368,154 5,529, ,039 5% Prepaid Transfers 2,305,000 3,421,565 3,939,123 1,634,123 71% Passenger Facility Charge (B) n/m Insurance Proceeds & Other ( D) - 3,322, % Proceeds from Land & Property Sales (C) 750,000 1,085,000 2,000,000 1,250, % Capital Improvement Funds 26,113,583 7,177,131 21,476,978 (4,636,605) -18% TOTAL $53,000,000 $ 53,000,000 $ 57,000,000 $4,000,000 8% (A) The large variance in Federal and State Grants is due to the timing of the receipt of grants and actual spend on the projects the grants are funding. Several large grants were received in late 2013 and the capital spend occurred later than anticipated pushing the grant proceeds into (B) Passenger Facility Charges (PFC's) are recognized as capital funding sources to the extent anticipated to fund capital program costs in each respective year. The current approved PFC Use Application does not anticipate the funding of any future capital projects. (C) Proceeds from Land and Property Sales represents auction proceeds from the sale of property, proceeds from the sale of Airport land, and property sales under the Purchase Assurance ( Noise Compatibility ) Program. (D) Insurance Proceeds & Other includes $3.117 million for the Constant Maturity Swap reversal completed in 2014 the balance of the insurance proceeds anticipated for the Rebuild of Building #122 in the 2014 Forecast. 9

13 Analysis of Airport System Fund (ASF) Revenue Budget Ordinance Ordinance vs 2014 Budget Ordinance Fav / (Unfav) Variance Budget Budget $ % Airline $ 44,881,378 $ 47,657,120 $ 2,775, % Airfield 383, ,096 (7,904) -2.1% Retail 18,707,349 19,043, , % Parking 38,160,076 40,984,598 2,824, % Properties 20,868,216 20,262,773 (605,443) -2.9% Relievers 3,089,936 3,088,098 (1,838) -0.1% Indianapolis Maintenance Center (IMC) 8,485,574 8,558,107 72, % Other Income 57,577 64,577 7, % Special Leases - UAL 26,785,041 26,754,228 (30,813) -0.1% Operating Grant Revenue 764, , % Passenger Facility Charges (PFCs) 15,148,269 14,635,351 (512,918) -3.4% Customer Facility Charges (CFCs) 5,871,559 5,867,022 (4,537) -0.1% Interest/Other 4,232,646 4,151,402 (81,244) -1.9% TOTAL OPERATING REVENUE (before transfers) 187,434, ,206,202 4,771, % Inter-fund Transfers (9,827,524) (9,329,199) 498, % TOTAL (net of transfers) $ 177,607,097 $ 182,877,003 $ 5,269, % 2015 ASF Revenue Budget by Type ASF Revenue Budget vs 2014 Airline Parking Special Leases - UAL Properties Retail PFCs IMC CFCs Interest/Other $26,754,228 $20,262,773 $19,043,830 $14,635,351 $8,558,107 $5,867,022 $4,151,402 $40,984,598 $47,657,120 Millions $50 $45 $40 $35 $30 $25 $20 $15 $10 $5 $ ASF 2014 ASF Relievers $3,088,098 Operating Grant Revenue $764,000 Airfield/Other $439,673 IMC 4.5% CFCs 3.1% PFCs 7.6% Interest/Other 2.2% 2015 ASF Revenue Budget by Percentage Retail 9.9% Relievers 1.6% Operating Grant Revenue 0.4% Properties 10.5% Airfield/Other 0.2% Special Leases UAL 13.9% Airline 24.8% Parking 21.3% Management Comments Airline revenues are planned to increase $2.8 million (6.2%) attributable to a projected increase in landed weights of 3.6% and an increase in landing fee rates ($1.92 vs $1.88) and terminal rental rates ($95.11 vs $91.68). Retail revenue is anticipated to increase $0.3 million (1.8%) primarily attributable to an increase in Food & Beverage concessions offset by lower advertising revenues. Parking revenues are planned to increase $2.8 million (7.4%) based on actual trend from changes instituted as part of the 2013 Parking Strategy. Properties revenue is anticipated to decrease $0.6 million (2.9%) as the lease of the former postal hub expires Nov- 14 and planned not to renew for Passenger Facility Charges are planned to decrease $0.5 million (3.4%) based on actual yield trend and projected passenger numbers. 10

14 Analysis of Airport System Fund (ASF) Expenses Budget Ordinance Ordinance vs 2014 Budget Ordinance Fav / (Unfav) Variance Budget Budget $ % OPERATING AND MAINTENANCE: Personal Services $ 29,028,000 $ 29,065,000 $ (37,000) -0.1% Utilities 9,357,000 10,183,000 (826,000) -8.8% Contractual Services 18,124,000 18,971,000 (847,000) -4.7% Supplies & Materials 5,512,000 5,866,000 (354,000) -6.4% Other Charges 2,213,000 1,777, , % Capital Expenditures 376, ,000 (327,000) -87.0% Environmental Remediation 34,000 34, % Total Operating Expenses 64,644,000 66,599,000 (1,955,000) -3.0% DEBT SERVICE: Special Leases - UAL 33,420,000 33,579,000 (159,000) -0.5% Interest Payments 52,722,000 50,838,000 1,884, % Principal Payments 46,533,000 47,680,000 (1,147,000) -2.5% Total Debt Service 132,675, ,097, , % TOTAL AIRPORT SYSTEM FUND $ 197,319,000 $ 198,696,000 $ (1,377,000) -0.7% 2015 ASF Expense Budget by Type ASF Expense Budget vs 2014 Interest Payments $50,838, ASF 2014 ASF Principal Payments $47,680,000 $60 $50 Special Leases - UAL Personal Services $33,579,000 $29,065,000 Millions $40 $30 $20 Contractual Services $18,971,000 $10 Utilities $10,183,000 $0 Supplies/Materials & Other $7,677,000 Capital Expenditures $703, ASF Expense Budget by Percentage Management Comments Personal Services 14.6% Special Leases UAL 16.9% Principal Payments 24.0% Utilities anticipated to exceed prior year $0.8 million (8.8%) driven by rate increases and projected volume increase for natural gas. Contractual Services projected to increase $0.8 million (4.7%) relating to Information Technology strategic initiatives, outsourced parking garage facilities maintenance (restriping; power washing), and outsourced snow removal services for parking garage, properties, Relievers and IMC. Contractual Services 9.5% Supplies & Materials planned to increase $0.4 million (6.4%) relating to increases in fuel rates, replacement of 2 Ground Power Units (GPUs) and tower repairs. Utilities 5.1% Interest Payments 25.6% Other Charges are anticipated to decrease from prior year by $0.4 million (19.7%) relating to a reduction of rental expense due to fewer leased shuttle buses and the expiration of IMC leasehold enticement amortization in Supplies/Materials & Other 3.9% Capital Expenditures 0.4% Operating capital expenditures budgeted in 2015 include 8 vehicle replacements; 2 mower replacements; floor care equipment; and defibrillator replacements budgeted debt service represents lower interest payments and higher principal payments than prior year as the revenue bond series continues toward maturity and the amount of principal and interest dedicated in the payment has an inverse relationship. 11